The United States, Chile, and Serbia are highly competitive suppliers to the U.S. market for high value processed raspberry products, while Chile and Mexico are the most reliable suppliers, according to a new report by the U.S. International Trade Commission (USITC).
The U.S. processed raspberry industry in Washington State was a high cost producer of premium products, accounting for about two-fifths of a more than $1 billion market during 2015-2020, according to the report.
The investigation, Raspberries for Processing: Conditions of Competition between U.S. and Foreign Suppliers, with a Focus on Washington State, was requested by the United States Trade Representative in a letter received on April 9, 2020.
Most production of U.S.-grown raspberries for processing occurs in Washington State, and to a lesser extent in California and Oregon. The primary focus of the USITC investigation was on the industry in Washington.
As requested, the USITC, an independent, nonpartisan, factfinding federal agency, reported on the industry competitiveness of major raspberry suppliers to the United States and U.S. market pricing dynamics. The Commission also provided a quantitative assessment of the economic impact of imports.
The USITC was asked to investigate processed raspberries, including fresh raspberries that are used as inputs for processed products. These berries come from both domestic and foreign sources and may be fresh for processing, individually quick frozen (IQF), or non-IQF (block frozen raspberries, purees, and juice products).
The USITC findings include:
- The U.S. processed raspberry industry benefits from mechanization and a high level of vertical integration, while geographic concentration and high production costs limit its competitiveness.
- The United States (Washington State), Chile, and Serbia were highly competitive suppliers to the U.S. market in terms of product differentiation, and Chile and Mexico were highly competitive in terms of reliability of supply. Mexico was the only U.S. supplier assessed as highly competitive in terms of delivered costs.
- Chile and Serbia were large U.S. suppliers of IQF products, while Canada and Mexico focused on supplying non-IQF products.
- Based on available annual data, prices between 2015 and 2020 were most closely related to the combination of the level of U.S. production of processed raspberries in Washington State, U.S. stocks, and imports that made up total U.S. supply. In addition, increased import quantities were closely related to relatively low domestic production levels.
- According to the USITC’s economic model simulation for 2016-2020, domestic prices and production of non-individually quick frozen raspberries would have been higher in the absence of higher levels of U.S. imports. This model showed that reducing imports to levels based on long-term average growth rates would have increased the U.S. industry’s non-IQF gross revenue by $167.8 million over 5 years and prices by an average of 34.7 percent in each year, and IQF gross revenue by $70.1 million over 5 years. However, IQF prices would have only increased by an average of 1.1 percent in each year.
Raspberries for Processing: Conditions of Competition between U.S. and Foreign Suppliers, with a Focus on Washington State (Investigation No. 332-577, USITC Publication 5194, June 2021) is available on the USITC's Internet site at https://www.usitc.gov/publications/332/pub5194.pdf. The modeling underlying the analyses associated with this report is available at https://www.usitc.gov/publications/332/raspberries_2021/raspberriesdashboard.html.
USITC general factfinding investigations, such as this one, cover matters related to tariffs or trade and are generally conducted at the request of the U.S. Trade Representative, the House Committee on Ways and Means, or the Senate Committee on Finance. The resulting report conveys the Commission's objective findings and independent analyses on the subjects investigated. The Commission makes no recommendations on policy or other matters in its general factfinding reports. Upon completion of each investigation, the USITC submits its findings and analyses to the requester. General factfinding investigation reports are subsequently released to the public, unless they are classified by the requester for national security reasons.